Minimum Wage and the Left’s Willingness to Change Its Story

Noah Rothman has noticed that progressives in and around government are perfectly happy to switch their claims about what a policy will do depending on the circumstances:

Covert was hardly alone. The CBO’s assessment of the negative impact on employment was “fuzzy and unreliable,” while it probably underestimated the positive impacts of the minimum wage, declared National Memo’s Joe Conason. Even the president and the government he leads got in on the act. “There’s no solid evidence that a higher minimum wage costs jobs,” Barack Obama declared. Over at the Department of Labor, a web page dedicated to serving as a minimum wage “myth buster” soon appeared, which echoed the president’s sentiments. “Myth: Increasing the minimum wage will cause people to lose their jobs,” the Labor Department truth-seekers averred. “Not true.” They cited a letter to the president signed by 600 economists who insisted that a minimum wage hike had “little or no negative effect on the employment of minimum-wage workers.”

It was perhaps with these appeals to authority in mind that the nation’s most liberally governed states embarked on a brave journey into the unknown. This week, New York and California’s legislatures both approved minimum wage increases, not to the $10.10 per hour, for which President Barack Obama advocated and approved for federal contractors, but to $15 per hour. Despite both states having higher unemployment rates than the national average, their respective governors are expected to sign those measures. Their advocacy campaign successful and complete, the left is now shifting from denying that there will be any adverse effects on employment as a result of the minimum wage hike to admitting that those effects will materialize and lead to a kind of desirable economic Darwinism.

For well-meaning progressives, a public policy isn’t about its likely effects. It’s about faith in the intention. For whatever reason, they believe it’s the right thing to do to force employers to find a way to pay their employees more than the market suggests their labor is worth. Satisfying this mandate for justice outweighs determining whether it will result in an overall happier population.

For the self-serving progressives who manipulate the others, neither the intention nor the likely effect is very important. They’re looking for means of buying votes and gathering unto themselves power. This is a likely effect — actually, an inevitable one — of adopting a political philosophy built on empowering a small group of politicians to take control of the economy and all of society. Unfortunately, the faith in the intention of making the world fair and friendly is powerful, having been inflated with fluff for a century.

Like so much in economics, there are so many factors that it is difficult to quantify them. Unknown to economists there may be a robotic burger flipper out there that is not economic below a wage level of $13.50 an hour. A wage level of $15.00 clearly exceeds the price point and Mickey Dee begins replacing employees with robots. Well those employs didn’t lose their jobs to an increase “minimum wage”, they lost it to “technology”. Sometimes it works in reverse, the “cotton gin” spurred the economics of slave labor. Before its abolition, low wage immigrants were destroying the economics of slave labor.

When even I have a robotic vacuum cleaner, it is just around the corner, isn’t it? So, I am unimpressed by the opinion of 600 economists, there are probably 600 more of an opposite opinion. As they used to say at HBS “They didn’t draw their decision trees out far enough”.

Mike678

Increasing wages without an increase in either effort or skill on the part of the employee rewards an entitlement mentality. Why get an education or work hard–just wait with your hand out and some politician will give you what you want..not what you need. Not exactly the way to develop an entrepreneurial can-do society!

Rhett Hardwick

Why get an education or work hard–just wait with your hand out and some politician will give you what you want

and, then, they will import cheap foreign labor to do the jobs you are qualified for.

Mike678

and borrow…19 Trillion and counting….

Northern Exposure

One more factor in the exodus from those states. RI can’t be far behind!